Approval of RCE by the Board of Directors is mandatory for determination and truing up of tariffs

Central Electricity Regulatory Commission, New Delhi: A Bench comprising of Mr. P.K. Pujari (Chairperson), Mr. A.K. Singhal (Member) and Dr. M.K. Iyer (Member) disposed of a petition which was filed to true up the fees and charges for the period of 2009-2014 and to determine the fees and charges of certain assets for the period of 2014-2019. The tariff for Asset I, II and III were approved by an earlier petition, but the tariff for Asset IV, which was brought into commercial operation in the later stages of the 2009-14 period, was not allowed. Subsequently, the present petition also sought to approve both the tariff for the period of 2009-14 and 2014-19 on Asset IV.

Upon the direction of the Commission, the petitioner submitted documentary evidence pertaining to the time by which the project over-ran and the chronology of the events relating to it.

The Commission stated that there had been an earlier adjournment in the proceedings on account of the reassessment of the capital cost. However, the implications of such a reassessment had not been brought to the commission’s notice by the petitioners. The requirement of the details of the reassessment as well as the approval of the RCE were sine qua non for the truing up exercise for the tariff period 2009-2014 and the determination of the tariffs for the 2014-2019 period. In the absence of such approval being given by the board of directors, the petition could not be sustained, and the tariffs determined in the previous petition would continue to apply. The petitioner was given the liberty to file a fresh petition once the approval was granted. [Power Grid Corporation of India Limited v. National Thermal Power Corporation Limited, Petition No. 248/TT/2018, Order dated 20/9/2018]

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